Melbourne November 29th auction preview

Dr Andrew Wilson

Melbourne’s weekend auction market continues to fade with last weekend recording the lowest clearance rate not just for spring but for the year so far. A surge in late spring auctions numbers is impacting market activity with buyers increasingly spoiled for choice.

Last weekend 1,154 properties were listed for auction, almost identical to the previous weekend’s 1,153 and well ahead of the 931 auctions conducted over the same weekend last year.

Auctions numbers will rise strongly this weekend with over 1300 homes listed to go under the hammer in the metro area. This is well ahead of last weekend’s result and just below the 1341 auctions conducted over the same weekend last year.

Record numbers of auctions will continue to test a fading market through December to the Xmas break.

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Melbourne’s inner city will host the most number of auctions this weekend with 220 closely followed by the inner south with 209, the inner east with 188, the west 185, the north east 165, the outer east 160, the north 109 and the south east 49.

The most popular suburb for auction listings this weekend in metro Melbourne is Richmond in the outer east with 24 followed by Glen Waverley in the outer east and Reservoir in the north east each with 22, Port Melbourne in the inner city with 21, St Kilda also in the inner city with 19, Mount Waverley in the inner east and Melbourne CBD each with 18 and Doncaster in the inner east and Brighton in the inner south each with 17 auctions scheduled this weekend.

Last weekend’s auction clearance rate of 67.1 percent was well below the previous weekend’s 72.1 percent with the local market clearly tracking backwards since the Melbourne Cup weekend holiday.

Melbourne’s outer east suburban auction market remains resilient recording clearly the highest clearance rate of all the regions at the weekend with 82.8 percent. Next highest was the inner east with a rate of 71.0 percent followed by the inner south 70.2 percent, the north 66.2 percent and the north east with a clearance rate of 66.0 percent.

Melbourne’s four weekend average clearance rate has fallen to 72.7 percent well down on the previous four weekend average result of 75.4 percent. Trend auction activity continues to decline.

Next week the Reserve Bank meets for the final time this year to determine the direction of official interest rates until it meets again in February next year. Rates are likely to remain at the current 60 year low of 2.5 percent for the 16th consecutive month – equalling the longest steady sequence since 1997-98.

Although rates are likely to remain on hold current economic conditions continue to point to a downward bias next year if a sustained improvement doesn’t materialise. Unemployment is at decade high levels, building approvals are flattening, and the dollar remains relatively high. And housing market activity is also flattening with house price growth in Melbourne this year struggling to meet the inflation rate.